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RBI/2006-2007/317
RPCD.CO.No.RRB.BC.69/03.05.33/2006-07
April 11, 2007
All Regional Rural Banks
Dear Sir,
Rounding off amounts of cheques to the nearest rupee
We advise that recently a case involving refusal by a bank
to accept a draft drawn in fraction of a rupee lodged for collection to the
credit of Government account came up before the High Court of Gujarat, Ahmedabad.
The High Court of Gujarat, taking a serious view in the matter, has directed
Reserve Bank of India to take appropriate steps in the matter in accordance
with law, in the light of the extant instructions and, if required, issue fresh
notifications/ notices to all the banks who have issued internal circulars not
to receive such cheques, etc., and see that stern action is taken against the
persons who refuse to receive the cheques / drafts, which are drawn in fractions
of a rupee. Regional Rural Banks (RRBs) are, therefore, advised to ensure that
cheques / drafts issued by clients containing fractions of a rupee are not rejected
or dishonoured by them. RRBs may also review the practice being followed by
them in this regard and take necessary steps, including through issue of internal
circulars, etc, to ensure that the concerned staff are well versed with these
instructions so that the general public does not suffer. RRBs may also ensure
that appropriate action is taken against members of their staff who are found
to have refused to accept cheques / drafts containing fractions of a rupee.
2. Please note that any RRB violating the aforesaid instructions
would be liable to be penalised under the provisions of the Banking Regulation
Act, 1949.
3. Please acknowledge receipt to our Regional Office concerned.
Yours faithfully,
(C.S.Murthy)
Chief General Manager-in-charge
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